Ramping up glove production: Government funding drives Showa expansion in U.S.

FAYETTE, Ala.—Showa Group will triple its domestic PPE glove capacity and has plans to produce an additional 1.2 billion gloves by the end of 2022.

The Menlo, Ga.-based company said it is in the process of a three-phased buildout of two additional facilities at its 40,000-sq.-ft. facility in Fayette, Ala., and it has received more than $81 million from the U.S. Department of Health & Human Services to drive this expansion.

Just ahead of the pandemic, the company already had plans in play to expand the site. Showa spent $35 million of its own money to build four additional high-speed production lines to bring the facility's capacity up to 800 million gloves per year, said Richard Heppell, president and chief operating officer for the Americas, Oceania and EMEA.

"Then through the course of the pandemic, of course the United States government wanted to look at more onshoring capabilities to better protect itself and provide more PPE without exposure to Asia," Heppell said.

With the DHHS funding, the company will build two adjacent manufacturing facilities that will produce an additional 1.2 billion gloves. Heppell said he expects each to be operational by June 2023 and September 2024, respectively.

Including both the company's initial and government-funded expansion plans, the site will total about 160,000 square feet, and Showa will have the capacity to produce 2.8 billion gloves per year intended for the U.S. domestic market.

The first phase of the expansion already is complete with two production lines running at full capacity, about 400 million gloves per year. In October 2020, the company had anticipated the first two lines to be operational by April and May of 2021.

"Now gloves are (coming) off the line and being shipped to customers," he said.

Heppell said the upcoming expansion should more than double its work force at the facility. Pre-pandemic, the site had more than 200 workers, and Heppell anticipates finishing the project with about 450.

As for the total cost of the project, the government funding would have been enough to cover the entire expansion cost before the pandemic, but "the world's gone crazy," Heppell said,

"We have had to dig into our own pockets," he said, noting the rising cost of steel and shipping.

For the 12 production lines, Heppell said, "it's about $3 million we've got to dig into" for shipping container costs—with about 27 containers needed per line.

The total estimated cost of the project is about $120 million, including the initial expense pre-DHHS funding.

Since the start of the pandemic in 2020, companies new and seasoned have been dipping into the domestic nitrile glove industry, getting their bite of government funding toward the onshoring of PPE.

But if the nitrile butadiene rubber or latex required to manufacture these gloves isn't sourced domestically, is the U.S. production of gloves any more secure than shipping the entire end product from overseas?

Showa has been in the game for 70 years and has a global platform that includes eight manufacturing locations around the world with more than 6,500 employees.

The company has produced a domestic supply of PPE in the U.S. for the last 50 years, according to the company, and its Fayette facility has manufactured gloves in the U.S. for the past 30 years, Heppell said.

He added that because of the company's history in the U.S., it has 510(k) approval from the FDA on its gloves, ensuring the product's ethical sustainability, safety and effectiveness.

Until the pandemic, Showa was the only glove manufacturer domestically producing gloves for the U.S., according to the company.

But to be a truly secure, "Made in America" product, its materials must be domestically sourced, too. And Showa recognizes this.

"That's critical to our mission," Heppell said, noting he was quick to handle this for the company.

"We, Showa, have secured the only current domestic capability of NBL (nitrile butadiene latex)," partnering with Zeon Chemicals out of Louisville, Ky., he said.

"We formed a partnership very early in this and put a mutual agreement together," Heppell said, noting Showa buys all of Zeon's capacity and works together on research and development to ensure the grades of rubber are a good fit for the gloves.

He said this agreement with Zeon is what gives Showa the ability to 100-percent meet the Berry Amendment, as all the company's raw materials in glove production—not just the nitrile rubber, but including chemicals, packaging and more—are sourced from the U.S.

The Berry Amendment is a statutory requirement that restricts the U.S. Department of Defense from using funds appropriated or otherwise available to the department for procurement of certain products that are not grown, reprocessed, reused or produced in the U.S., according to the U.S. Department of Commerce and International Trade Administration.

"We absolutely have that capability," Heppell said. "If America wants to protect itself and make sure they've got that capability, we absolutely can give them that assurance."

Several companies have come forward with plans to build their own NBR production plants in the U.S.—including EBW (Empowering a Billion Women) Worldwide Inc., which plans to build what it is calling the NBR "Rosie" plant in southern Texas; and Blue Star NBR L.L.C. and American Glove Innovations, which are investing $714 million in NBR glove manufacturing operations and NBR production in Wytheville, Va.

While work is underway throughout the nitrile glove industry to produce more nitrile rubber in the U.S., Heppell said new production in the U.S. is years away.

"I reckon (it will be) at least two years before you'd see that, probably longer," he said.

As companies break into the nitrile gloves sphere, whether they'll actually see the light of day is difficult to tell, Heppell said.

"I'm tracking about 22 claims at the moment. There's a lot of activity," he said. "It's very difficult to determine what's real and what's not, there's a lot of opportunists, of course, looking here."

He said he knew of two companies to date that are close to having "some capability."

"They're reporting to have built—or (are) building—similar capacity to ours" at about 2.5 billion gloves (per year) each. "But again, (they're) certainly not ready yet, and they would have to be buying their raw materials offshore."

Heppell listed several factors that could affect the success of a company's pursuit of nitrile glove production.

"It's a long-term commitment with building these factories. And these production lines only work when they're running wide open 24/7," Heppell said. "To do that, you've got to have meaningful supply agreements, and the U.S. isn't historically good at giving meaningful long-term supply agreements."

Without having these supply agreements in place, he said companies will find it difficult to get their production up and running and the employees necessary to sustain the lines while maintaining profitability.

"If you're not in the business, you've got to create the business," Heppell said, noting Showa has a lot of loyal, long-term distribution partners and customers.

"There's a lot of assumption that the government's just going to give you orders," he continued. "They're not. You've got to go hunt those out and make those work and give them a good reason.

"There's no guarantees in life. That's absolute certainty."

As the production of nitrile gloves ramps up, so does their waste.

"An estimated 100 billion pairs of gloves are thrown away each year," according to Showa. "Laid out end-to-end, that's enough to stretch to the moon and back 30 times."

Approximately 87,000 metric tons of PPE waste was generated between March 2020 and November 2021, according to a Feb. 1 report from the World Health Organization.

"This gargantuan amount of global waste created during the COVID-19 pandemic is challenging political and industry leaders to rethink approaches to PPE waste—not only for COVID-19 but to reduce the environmental impact of future threats to public health," a Showa spokesman said.

There are two ways to combat this, he said. The first is by reshoring PPE to reduce carbon emissions involved in the shipment of goods, and the second is advancing the technology and materials used to produce PPE.

Heppell said the company invests heavily in R&D to reduce its products' impact on the environment in the wake of the growing climate crisis, and it launched its first biodegradable glove in 2012.

The company, in September 2021, received GreenCircle certification—becoming the first glove manufacturer to do so—for eight gloves from its range of biodegradable gloves.

Showa launched its first biodegradable glove in 2012 with its Eco Best Technology (EBT), a new formulation for nitrile gloves that makes them biodegradable in landfill conditions.

"The ASTM D5526 certification demonstrated that Showa EBT gloves achieved 82 percent biodegradation in only 386 days," the company said in a news release, "while gloves without EBT achieved only 1.9 percent biodegradation over the same period of time."

Heppell said Showa has had "quite a bit of foresight" when it comes to sustainability.

With the development of its biodegradable glove, he said the company has been very successful in the decade since.

"It's our top-selling glove right now, in fact, across our whole company," he said. "You're seeing more and more PPE demand, (and) these are, by nature, disposable products."

Showa's EBT gloves, Heppell said, will completely biodegrade in landfill conditions within five years.

He said every glove Showa will produce out of its Fayette location will be fully biodegradable.

When it comes to potentially facing another serious health crisis like the COVID-19 pandemic, there have been "strong intentions" from the U.S. government to improve its position of preparedness, Heppell said, noting the success of onshoring of face masks.

In terms of glove production, he said the U.S. has "very good capability" as it invests in the endeavor.

"There are going to be some companies that will succeed and stand up glove production, and maybe a lot that don't. But for those that do, collectively together, we should be able to give a much stronger safety net to the United States—both in national stockpile and, indeed, the ability to turn on supplies to frontline workers who need it most," he said.

"So yes," he said, the U.S. will "be better equipped than you were, certainly, two years ago."